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October 29, 2014

Nicotine processing overview

As e-cigarette sales grow, so will nicotine extract market – Tobacco Industry Today.

Note that the demand for US grown raw material is growing. China is the cheapest source, but committed vendors will be attracted to US vendors like USA Liquid Nicotine for easier verification of how the raw material (tobacco plant matter) is processed and tested for consistency.

It is my personal hope that the increase in tobacco grown in the US will be done with sustainability in mind; proper handling and the necessary protection and training for the workers.

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Representatives of tobacco companies, retailers, farmers and tobacco-control groups attend the annual conference to discuss tobacco regulation and scientific issues.

Electronic cigarettes, or e-cigarettes, are hand-held, battery-powered devices that heat a liquid solution of nicotine and flavorings, producing a vapor that the consumer inhales. E-cigarette sales are still small compared with the overall tobacco market, but sales are growing and could reach $1.5 billion to $2 billion this year, according to some estimates.

Most of the nicotine extract that is now being used in electronic cigarettes comes from suppliers in China, India or Europe, with the cheapest source being China, but U.S. manufacturers also are about to start production, Leduc said.

For instance, Richmond-based Universal Corp., the world’s largest supplier of tobacco leaf, said in August that one of its subsidiaries was forming a venture with another company to produce and sell liquid nicotine for e-cigarettes.

Leduc pegged the cost of nicotine, at its cheapest, at about $130 per liter from China, with the most expensive being as much as $500 per liter from suppliers in Europe.

“I think the price of nicotine is going to stay strong or increase as demand grows,” he said.

Based on growth estimates for electronic-cigarette sales, Leduc predicted that the industry could use more than 500 tons of nicotine a year by 2018.

“There will be a market for American-made nicotine,” he said. “I can foresee that over the next couple of years, American-grown tobacco will be used” for extracted nicotine.

Don Burke, senior vice president at Management Science Associates Inc., a Pennsylvania-based business research firm, said total tobacco product sales in the U.S. declined about 3.8 percent in the first four months of this year compared with the same period of 2013.

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